Mr Fletcher, a former Burnley player had been brought in by ACL to help run the Ricoh Arena, but was transferred to City along with Ken Sharp and Mal Branigan as a senior management team on the orders of Geoffrey Robinson who took over as Acting Chairman.
Coventry City have issued the following statement: "The Board of Coventry City Football Club can today confirm that Managing Director Paul Fletcher has resigned.
The Club would like to thank Paul for his dedication and hard work during what has undoubtedly been a difficult time for Coventry City.
Coventry City will be making no further statement at this time."
Speaking to the Coventry Observer, Fletcher blamed Coventry City Council and The Alan Higgs Trust for scaring off prospective American bidders Manhatten.
He said: "I've always been open and told the fans the truth and this has really broken my heart. The truth is as far as the takeover is concerned we are no nearer or further than we were six or seven months ago Operation Premiership has come off the rails.'
"The Manhattan Group came this week but I never got a chance to meet them. It was then I decided to resign.
"They came over and then just jumped back on the plane home and the reason for that is the Higgs charity could not come to an agreement over the price for their shareholding. It is up to the council and the Higgs charity to represent themselves.
"But I have looked over five, six, seven stadium projects and have never come across a project where the council have been wanting to take cash out of the deal. We know where the bank stands but the council and the Higgs charity seem to want a return but it appears their requests seem to be frightening.'